Dear Editor,
The recent statement by President Ali is worrisome at best. He stated that the agreement with Exxon will remain as is and he also implied that further attempts to negotiate a more equitable agreement with Exxon would lead to loss of investor confidence. He was echoing the sentiments of Exxon, and for a moment it felt like Exxon had gained a new spokesperson for their negotiating position.
If what Exxon says about loss of investor confidence was true, which it isn’t, loss of investor confidence would also prevent the restructuring of the current structure of the PSA for new investors. However, the government is currently in the process of revamping the terms of the PSA to be used for new investors. The proposed royalty rate is being increased and the cost recovery percentage is also being lowered. Several announcements have been made which indicate that a number of new investors have shown interest in bidding for the available oil blocks.
Obviously, this is an indication that there is interest to do business under the new terms that have been proposed by President Jagdeo. Exxon should be willing to also entertain those new terms in their current agreement. The need to proceed with a negotiation is clearly beneficial to ensuring the new investors are also comfortable that they are competing on a leveled playing field. After several years, the public cry continues for a better agreement with Exxon. Our leaders should not be deaf to the public’s demands and our leaders must maintain a strong negotiating position to ensure that the vision for the country can be easily implemented.
To do otherwise will result in increased risk to the country’s earnings and also put at risk the government’s proposed vision for the development of the country. Maybe it was fitting that the President of Trinidad was the one who cut the ribbon to open to current event for the oil sector. Our leaders must cease to delegate the leadership of our country to those who are guests amongst us. The government does not work for Exxon. Exxon is here as a guest and we must not forget the importance of remembering whose country it is and whose resources are being exploited.
Sincerely,
Jamil Changlee
Chairman
The Cooperative Republicans of
Guyana